TCS Is Not Racist, They Didn’t Discriminate Against Americans: US Court Closes Racial Bias Case Forever

India’s biggest software services company, Tata Consultancy Services (TCS) has been alleged to discriminate and be biased towards staffing Indian workers over Americans, in its US offices.

Three former workers of TCS questioned the verdict of a California jury last week, when they rejected the claims that the IT major was being partial in the States. However, inspite of these three workers questioning the decision, the US district court has refused to hold a fresh trial of the same case.

US Court Stands with TCS this Time

On August 20, the Northern District of California district court, gave its verdict that it denied agreeing that the Indian IT firm, Tata Consultancy Services preferred to staff its US offices with Indians instead of Americans. 

Three former TCS employees disagreed with this verdict and requested the court to reopen the case, as they believed it was an ‘unjust result’. The district court, however refused to hold a fresh trial on the same, complying to all the proofs and reasons it had already witnessed by TCS, to stand affirmative on its decision.

During the trial, TCS presented enough proofs that employees who Indians, were fired because they had refused to relocate or were challenging to work with, among other reasons. None of the hiring or firing was done anywhere on the basis of an employee’s background or national origin.

In fact, the jury also said that even if TCS’ verdict had an error in the above statement, the verdict would still not likely be affected because TCS presented other, similar evidence in support of the verdict. TCS had earlier tried to get the case dismissed, but a federal judge denied the request, leading to a court trial last year.

The Impact of H1B Alterations is Negatively Affecting the Indian IT Sector:

The trial had brought into focus the work-visas granted to IT companies, which use them to bring overseas employees to the US. Some companies, however misuse the power of this visa, which is highly criticized by President Trump. This led to policies which have made it significantly harder for overseas workers to secure H-1B visas. In fact, with the H-1B denial rates rocketing across the Indian IT industry.

The Indian IT sector has always majorly relied on labor forces of H1B holders, as they conduct the same work at a cheaper rate, while the local talent comes with an additional cost of 25% to 30% hike in salaries. With the H1B visa approvals reducing dramatically by 21% in the last 5 years, Indian tech companies have been compelled to hire more locally, directly leading to an escalation in employee costs.

Infosys witnessed 2,122 visa denials in FY 18, followed by TCS where the rejections were 1,896. Out of the three Indian IT giants, Cognizant was leading with 32% denials, followed by Infosys and TCS at 26% and 18% respectively. As a result, cost structures for the Indian IT majors have been impacted majorly.